How the ObamaCare Death Panel Defies the Constitution

This column by ACRU General Counsel Peter Ferrara was published January 7, 2015 atAmerican Thinker.

Former Democrat House Speaker Nancy Pelosi famously said about the Affordable Care Act (ACA), i.e. ObamaCare, “We have to pass the bill so that you can find out what is in it.” That has turned out to be so true. We did have to pass it to find out that what Sarah Palin said about it was right after all.

The Death Panel in Obamacare is named the Independent Payment Advisory Board (IPAB). What the law says about the powers of IPAB is horrific, worthy of a Third World, authoritarian autocracy, rather than the world’s leading democratic republic.

The Goldwater Institute, a free market think tank in Phoenix, Arizona, is suing to have IPAB declared unconstitutional. Last November 5, they filed a Petition for a Writ of Certiorari asking the Supreme Court to hear the case. On December 10, the American Civil Rights Union (ACRU), for which I serve as General Counsel, filed a brief in their support.

“The so-called Independent Payment Advisory Board (IPAB), established by the Patient Protection and Affordable Care Act (“ACA” or “Obamacare”), involves the most comprehensive assault on the fundamental constitutional doctrine of Separation of Powers in the history of American law. The ACA, by its express terms, purports to exempt IPAB from any legislative, judicial, and even executive branch oversight. That makes IPAB the most authoritarian and anti-democratic institution in the history of American law, since slavery.”

Implementing the doctrine of the Separation of Powers, the Constitution provides that Congress holds the Legislative Power to enact the laws; the President has the Executive Power to execute, or implement and administer the laws, and the Judiciary has the power to interpret the laws, and adjudicate disputes regarding them. This Separation of Powers was adopted by the Founding Fathers as a key insight arising from the European Enlightenment to provide for effective checks and balances in American government. It was intended, and has long worked, to protect the liberty of the American people from an authoritarian combination of powers in one branch of government, which could then override the rights and liberties of the people, and the operation of democracy.

The IPA board comprises 15 unelected bureaucrats not personally accountable to the public. After they are appointed by the president with the advice and consent of the Senate, that is the end of any effective authority that any branch of government has over them.

While the ACA provides that board members may serve up to two consecutive terms, it also says, as Cohen and Cannon write, “If a board member reaches the end of his term and the President declines to appoint (or the Senate fails to confirm) a successor, he may serve indefinitely.”

Moreover, ObamaCare provides that, “[T]he board may conduct business whenever half of its appointed members are present, and may act upon a majority vote by all members present. When there are no vacancies, therefore, the board will reach a quorum whenever as few as eight members gather, and any five members could wield IPAB’s considerable powers,” as Cohen and Cannon further write.

Indeed, it is possible under the express terms of the ACA for the vast powers of IPAB to be vested in and exercised by just one unelected person — one. Cohen and Cannon explain, “If there are 14 vacancies on the board, the Act allows the sole appointed member to constitute a quorum, conduct official business, and issue ‘proposals.’”

The president, therefore, could appoint just one party loyalist, who can serve for life, to carry out all of IPAB’s vast powers. Cohen and Cannon add, “Or none: if the President fails to appoint any board members (or the Senate fails to confirm the president’s appointments, or a majority of the board cannot agree on a proposal) the Act authorizes the Secretary of Health and Human Services (HHS) to exercise the board’s powers unilaterally.” And who does the Secretary of HHS answer to? President Obama.

Those powers, moreover, would include the power of the HHS Secretary to assume legislative authority and appropriate funds to his or her own department to administer his or her own directives.

Quality Health Care for All — or Quality Health Care for None?

In order to help finance its new health care benefits, ObamaCare provides for cuts to future Medicare spending of $716 billion over the first 10 years alone, as officially scored by CBO and Medicare’s actuaries. To further ensure funding for its new benefits, ObamaCare created IPAB to adopt further cuts to Medicare to the extent necessary to keep Medicare spending within certain target limits. Beginning in 2018, that target limit will be the rate of growth of the economy per capita plus one percentage point.

For every year that the Medicare actuaries project Medicare spending will exceed the specified limits, the ACA requires IPAB, no later than January 15 of the preceding year, to issue a “detailed and specific… legislative proposal… related to the Medicare program” that “shall… result in a net reduction in total Medicare program spending… that is at least equal to the applicable savings target.” Further, it authorizes IPAB to “propose” even greater reductions in projected Medicare spending.

I informed the Supreme Court in the ACRU brief, “If this Court does not act to consider this case, IPAB will be busy rewriting the Medicare Act for many years. Historically, per capita Medicare spending has grown an average of 2.6 percentage points higher each year than per capita GDP. At those current, long term trends, IPAB will be cutting at least 1.6% of Medicare spending each and every year, for many years.” Of course, an Executive Branch board of unelected bureaucrats is not the way to reduce Medicare spending.

Moreover, IPAB’s powers are not limited to Medicare under the language of the Obamacare law. IPAB can issue any proposal “related to the Medicare program.” The board can reason that if it is restricting spending on health care under Medicare, then it must also restrict spending on health care throughout the economy, or doctors and hospitals will flee Medicare and the seniors it is supposed to be serving, to provide better compensated health care to others. Indeed, Medicare’s actuaries are already effectively making just this argument about the impact on Medicare from Obamacare’s restrictions and cuts for Medicare.

As Cohen and Cannon report, ObamaCare “requires IPAB” to produce proposals to “slow the growth in national health expenditures” and “Non-Federal Health Care Programs.” Cohen and Cannon further explain that ObamaCare,

“‘provides that if the Medicare actuaries project that the growth rate of national health expenditures will exceed that of per-enrollee Medicare spending, IPAB’s ‘proposals shall be designed to help reduce the growth rate [of national health expenditures] while maintaining or enhancing beneficiary access to quality care under [Medicare].’ This is a clear mandate to reduce both government and private sector health care spending. Indeed, the simplest way to reduce overall health care spending while maintaining access to care for Medicare enrollees is to limit spending on patients outside of Medicare.”

Limiting private medical spending is one of the most effective ways for the government to ration health care. With their compensation so sharply slashed, doctors and hospitals will start to withdraw health care from the market. Investors will begin to divert capital elsewhere for better returns, so health care will not be there when you need it. Investors will increasingly shun innovative health care breakthroughs that the state of health care science could support. When your doctor delivers the bad news that there is nothing further that can be done to save the life of your child or beloved aging parent, you won’t know if that is because of the current state of medical care, or because of all the busybody Obamacare “Progressives.” Your doctor probably will not know either. Most Democrats will not remotely understand this, or what their political party has done to the rest of us.

This is exactly what conservatives have feared all along, and exactly what Sarah Palin warned us about. Obama and his Democrats sold Obamacare on the grounds that it meant health care for all. But what they are doing with Obamacare in redistributing health care is analogous to what always happens with such government redistribution — lowering the standard of health care for all in the process. And we don’t even get health care for all under ObamaCare, as even the Establishment CBO projects that 30 million Americans will still be uninsured 10 years after this hideous law is fully implemented. In fact, it is not even clear yet whether the net effect of ObamaCare will be to lower or raise the number of uninsured. So, conceivably, we could end up spending far more money while providing far less health care to far fewer people.

Worst of all, under the ObamaCare statute, IPAB’s so-called proposals are not proposals at all. ObamaCare’s language provides for them to automatically become law without congressional action, congressional approval, meaningful congressional oversight, or possible subjection to a presidential veto.

As Cohen and Cannon explain,

“IPAB’s proposals will have force of law. The reasons for this are twofold. First, [the Obamacare statute] requires the Secretary of Health and Human Services to implement them.

Second, it severely restricts Congress’ ability to block their implementation by rejecting them or offering a substitute proposal.

These provisions will effectively make IPAB’s proposals law without the approval of Congress or the signature of the President.”

Under the ObamaCare statute, Cohen and Cannon add, “To prevent an IPAB proposal from becoming law, Congress must offer substitute…legislation that achieves the same budgetary result. [Alternatively], the Act requires a three-fifths vote of all the members of the Senate to waive [this requirement].” Otherwise, “IPAB’s legislative proposal automatically becomes law, and the Act requires the Secretary of Health and Human Services to implement it.”

Moreover, ‘after 2020, Congress loses the ability even to offer substitutes for IPAB proposals,” Cohen and Cannon add. “[I]n that case, the Act requires the Secretary to implement IPAB’s proposals even if Congress does enact a substitute.”

Constitution? What Constitution?

Most outrageously, the law also purports to sharply limit the legislative power of the Congress of the United States to ever repeal IPAB. Under the ACA, Congress can only ever repeal IPAB by introducing a specifically worded “Joint Resolution” in the House and the Senate between January 1, 2017 and February 1, 2017. Then it must pass that resolution with a three-fifths vote of all members of each house by August 15, 2017.

As Cohen and Cannon summarize:

“Congress has only about 15 business days in the year 2017 to propose [a] joint resolution of repeal [of IPAB]. Otherwise, the Act forever precludes repeal [of IPAB]. Congress must then pass that resolution with a three-fifths supermajority by August 15, 2017, or the Act forever precludes repeal…. If Congress fails to follow these precise steps, then [the ObamaCare statute] states the American people’s elected representatives may never repeal IPAB, ever.”

So the ObamaCare law not only shifts the legislative power of Congress to an Executive Branch agency under Obama, it also sharply restricts the legislative power of Congress itself. I wonder what the Democrat staffers must have been drinking and smoking when they came up with this.

In a final insult to constitutional injury, the law provides that, “Citizens will have no power to challenge IPAB’s edicts in court.” Cohen and Cannon state, “Finally, [the ACA] gives IPAB and the Secretary the sole authority to judge their own actions by prohibiting administrative or judicial review of the Secretary’s implementation of an IPAB proposal.”

Cohen and Cannon conclude,

“The Independent Payment Advisory Board is worse than unconstitutional — it is anti-constitutional. Congress’s legislative powers do not include the power to alter the constitutional procedure required for passage of laws. Nor does it include the power to entrench legislation by preventing it from being altered by future Congresses.”

Note that President Obama has not made any appointments to IPAB. That means that the Secretary of HHS, Sylvia Matthews Burwell, who has held office since last June and reports directly to President Obama, now personally holds all the powers of that board. That includes plenary powers to reorder anything related to health care, as if property rights, freedom of contract, the rule of law, the Constitution, and democracy do not apply to any business or transaction related to health care. In other words, within the Affordable Care Act, President Obama has set himself up as a health care dictator.

Perhaps it’s time to officially rename the Department of Health and Human Services the Department of Health and Human Suffering.

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